The Trillion Dollar Club’s New Member

Broadcom blasts above $1 trillion, market breadth weakens, Nvidia's risk rises, and more from the day.

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NEWS
The Trillion Dollar Club’s New Member

Source: Tenor.com

Broadcom’s strength buoyed the Nasdaq 100, but the rest of the major indexes had a tougher time as inflation fears mounted and year-end profit-taking continued. Next week the Fed is expected to cut rates again, but its economic projections and commentary will take center stage as investors look ahead to 2025. 👀

Today's issue covers the tale of two markets, the rising risk to Nvidia bulls, and other noteworthy pops and drops. 📰

Here’s the S&P 500 heatmap. 3 of 11 sectors closed green, with technology (+0.43%) leading and communication services (-1.19%) lagging.

Source: Finviz.com

And here are the closing prices: 

S&P 500

6,051

-0.00%

Nasdaq

19,927

+0.12%

Russell 2000

2,347

-0.60%

Dow Jones

43,828

-0.20%

Most bullish/bearish symbols on Stocktwits at the close: 📈 $ATIF, $LW, $WKEY, $RPTX, $LEDS 📉 $GOEV, $ABBV, $VKTX, $RH, $BETR*

*If you’re a business and want to access this data via our API, email us.

STOCKS
The Tale Of Two Stock Markets 🤔 

It was another disjointed week in the markets, with the small-cap Russell 2000 and price-weighted Dow Jones Industrial Average closing well in the red. Meanwhile, the Nasdaq 100 closed in the green as mega-cap tech stocks soared to new highs.

Broadcom was the latest tech giant to flex its muscles, jumping 25% on the back of a strong AI outlook and topping the $1 trillion market cap threshold for the first time. It adds to the already wild year-to-date performance of the 10 largest stocks in the U.S., nine of which are technology names. 💪 

Source: Koyfin.com

Strength in the market’s largest stocks has helped drive the market-cap indexes to record highs. However, technical analysts are flagging a growing divergence in the equal-weighted version of these indexes.

Below is the S&P 500 vs. its equal-weighted counterpart, which has fallen eight of the last ten days. The two indexes generally trade in lockstep, so this growing divergence is a notable change of character into 2025. 🤔 

Source: Koyfin.com

Despite the recent weakness under the surface, investors and traders continue to bet that the biggest winners will continue to win. As we’ve noted, sentiment is extremely bullish across many measures, but the lack of a clear catalyst for bears to take control has the market continuing to climb its “wall of worry.” 🤷 

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